Q. 4. Bills of Exchange Solution: Click here to get the Solution. [ For Solution Click Here ]


Q. 4. Bills of Exchange Solution: Click here to get the Solution. [ For Solution Click Here ]

Journal Entries in the books of Ram.

Date
Particulars
L.F.
Debit (Rs.)
Credit (Rs.)
7.3.16
Bills Receivable A/c .... Dr.

8000


To Rohit's A/c


8000

[Being the bill is drawn ]



7.3.16
Bank for Collection A/c ... Dr.

8000


To Bills Receivable A/c


8000

[Being the Bill is sent to Bank for Collection]








10.6.16
Rohit's A/c ... Dr.

8000


To Bank for Collection A/c


8000

[Being the sent to Bank for collection bill is dishonoured]








10.6.16
Rohit's A/c ... Dr.

200


To Interest A/c


200

[Being the interest is charged on balance Amount]








10.6.16
Cash A/c ..... Dr.

5000


To Rohit's A/c


5000

[Being the part payment made in cash]








10.6.16
Bills Receivable A/c ... Dr.

3200


To Rohit's A/c


3200

[Being the new bill is drawn along with interest]








13.8.16
Rohit's A/c ... Dr.

3200


To Bills Receivable A/c


3200

[Being the drawee became insolvent and hence the bill is automatically dishonoured]








13.8.16
Cash A/c ... Dr.

1500


Bad debts A/c ... Dr.

1700


To Rohit's A/c


3200

[Being the drawee became insolvent and only part of the amount could be recovered from his private estate]